“Yes, it has been a fairly lacklustre year for the past year and the reasons are quite clear. Growth has come down. There has been a lot of increased uncertainty around what is happening around global trade, what Trump is going to do, etc. Our core view is that you are likely to remain range bound until you start getting some clarity on these two core elements,” Anand said.
He added that the upcoming Q2 earnings season will be closely watched, as investors hope for a meaningful recovery in corporate performance. “We are going to be very closely watching this kind of Q2 earning season because a lot of people have a hope or belief that you will see a recovery in the second half. We watch corporate commentary very closely to see how clear is that just general optimism or are there are clear signs for that. You already had a few IT company results come out. They have been slightly better than expected. So, this earning season is going to be very important to lay the foundation for market performance going forward.”
Anand emphasized the importance of clarity on global trade issues, particularly the long-awaited US-India trade deal. “Until you do not have these two core headwinds being taken away, you are likely to see markets a bit range bound. It is also probably good at some level because after covid you have seen a strong one-way movement to the markets and you did need a certain amount of time for valuations to correct.”
Looking ahead, he anticipates a range-bound market over the next quarter to six months, with the potential for a more significant move once growth and trade uncertainties are resolved.
On investment strategy, Anand highlighted the digital ecosystem as a compelling long-term theme. “We have been very clear on this for the last couple of years. We are huge bulls on the whole digital ecosystem or digital disruption. So, digitally native platform businesses, the like of the Eternal, the Swiggys, Paytms listed, this entire space you are seeing a tremendous amount of value migration happening away from traditional businesses towards the space.”He further noted, “We believe that very strong growth rates can continue well into the decade and we are also very optimistic about the profitability of these business models as they reach stage of maturity. A combination of this very strong growth and a shift towards profitability according to us makes this hands down at least for us the theme to bet on over the current decade. So, at this current point in time especially from investors with a longer-term investment horizon, we keep believing that digital ecosystems is very-very attractive.”For shorter-term opportunities, Anand sees potential in banking and consumer sectors, citing signs of value and growth recovery.
As investors navigate a market shaped by uncertainty, the focus on digital disruption and emerging corporate earnings may provide guidance for portfolio strategies in the months ahead.
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